Category: Malaysia

Malaysia has suspended its MSC Malaysia tax regime, pending changes to bring it into line with recommendations from the OECD’s Base Erosion and Profit Shifting initiative. Under the regime, domestic and foreign information and communication technology-related businesses can apply for “MSC Malaysia Status,” which allows them to benefit from tax...

AEOI deals with the challenge of taxpayers operating cross-border but tax administrations remaining confined to their national borders, by providing an open international architecture. Singapore has activated three new Automatic Exchange of Financial Account Information (AEOI) relationships under the Multilateral Competent Authority Agreement (MCAA) on Automatic Exchange of Financial Account...

Cambodia has signed a double taxation agreement with Vietnam that protects each country’s nationals from dual taxation, according to a news release from the General Department of Taxation released on Tuesday. The agreement was signed on Saturday on the sidelines of the Greater Mekong Subregion Summit held in Hanoi. Chou...

Pakatan Harapan had unveiled an election manifesto earlier this month stating that they will restore the Sales and Service Tax (SST) after abolishing the Goods and Services Tax (GST) within the first 100 days of its administration. While the Prime Minister had pointed out earlier that Malaysia will only be...

KUALA LUMPUR: The Inland Revenue Board (IRB) will raise the level of awareness among taxpayers and boost compliance rate among them to achieve a collection target of RM134.7 billion this year. It chief executive officer (CEO) Datuk Seri Sabin Samitah said that in 2017, tax collection rose by 8.15% compared...

SUBANG: The Inland Revenue Board (IRB) will this year put in place strong measures to deter tax avoidance and evasion by focusing on individuals and firms engaging in such misconduct. Chief Executive Officer (CEO) Datuk Dr Sabin Samitah said the offences included those who engaged in aggressive tax planning, by...

Malaysia’s Inland Revenue Board (IRB) on January 11, 2018, released guidelines on applying for the resolution of double tax cases through the Mutual Agreement Procedure. The MAP Guidelines have been updated to incorporate the recommendations of the OECD BEPS Action 14 report on making dispute resolution mechanisms more effective. The...

CYBERJAYA: The Inland Revenue Board (IRB) is in the midst of auditing 15 banks with offshore transactions in an effort to collect hundreds of millions of ringgit worth of taxes. IRB deputy chief executive officer (compliance) Abdul Manaf Dim said the auditing processes of the banks nationwide were among the...

LABUAN: Bank Negara Malaysia (BNM) Governor Tan Sri Muhammad Ibrahim says the time has come for a review of Labuan’s current tax framework. He said the review is not only to ensure alignment with international best practices but also confirm the continued relevance of such incentives in catalysing new growth...

KUALA LUMPUR: The taxmen of the Inland Revenue Board (IRB) and Royal Malaysian Customs Department have set their sights on the digital economy. Treasury secretary-general Tan Sri Dr Mohd Irwan Serigar Abdullah pointed out last week that some foreign-owned digital economy players like Google, Uber and Facebook are currently not...

MULTINATIONAL corporations (MNCs) in Malaysia will soon be seeing more tax law changes coming their way as the authorities get down to tackling base erosion and profit shifting (BEPS). This follows efforts by the Organisation for Economic Co-operation and Development (OECD), approved by G20 leaders, to formulate a 15-step action...

Malaysia uses both progressive and flat rates for personal income tax, depending on an individual’s duration and type of work in the country. As expatriates may fall into either tax category depending on their work, it is important to understand Malaysia’s basic tax structure. The Income Tax Act of 1967...

Malaysian individuals and entities that have bank accounts overseas will soon see their financial information being shared with other countries and tax authorities in an effort to boost global transparency and tax compliance. This requirement is part of the automatic exchange of financial account information set out by the Organisation...

Malaysia should increase its goods and services tax (GST) rate, strengthen international anti-avoidance rules, and seek to boost compliance, the International Monetary Fund (IMF) has said. The IMF said that increasing the current six percent rate of GST by 0.5 percentage points would increase Malaysia’s revenues by an estimated 0.25...

KUALA LUMPUR: The Inland Revenue Board (IRB) plans to increase its penalty to 100% for individuals and companies who evade paying their taxes or misreported tax. IRB chief executive officer Datuk Sabin Samitah said the new penalty scheme, an increase from the current 45% penalty imposed on unpaid tax, will...

PETALING JAYA, Mar 15 (Sin Chew Daily) — Local taxation expert Koong Lin Loong said the Internal Revenue Department’s target was not wealthy people but tax evaders. “Whether a person is evading tax is normally assessed with the ten-point criteria, and assets of unidentified origins will be their focus of...

THE scope of the withholding tax — a tax imposed on non-residents for services rendered to Malaysia-based companies — has been widened. It is one of the major tax changes that came into effect on Jan 17 under the Finance Act 2017. Under the changes, non-residents must pay withholding tax...

CROSS-border taxation in current times is poised for significant changes. Tax is key in foreign ventures. Absent tax strategies and foreign tax leakages would erode margins and return of investment. Although international tax-efficient strategies to mitigate capital gains tax (CGT), withholding tax (WHT) and the risk of creating a taxable...

THERE was a time when a tax professional would confidently tell you that tax avoidance would not get you in trouble. You might be bending the rules a little to minimise your tax liability, but as long as you followed the letter of the law, you would be fine. On...

KUALA LUMPUR: The Royal Malaysian Customs Department is considering amendments to the Goods and Services Tax Act (GST Act) to start taxing foreign online service suppliers, said deputy director-general Datuk Subromaniam Tholasy. “E-commerce is pretty much catered for, except business-to-consumer (B2C) for example, downloads from overseas, how do we tax...

In efforts towards global transparency, over 100 countries have agreed to automatically exchange information relating to financial accounts (AEOI) with each other under the Convention on Mutual Administrative Assistance in Tax Matters (Convention). The OECD had also developed the Common Reporting Standards (CRS) which set out the common information to...

KUALA LUMPUR: The Inland Revenue Board (IRB) has its eye on tax evaders and tracking them down will be one of its priorities in 2017. IRB deputy chief executive Datuk Mohd Nizom Sairi said this is part of the agency’s plans to meet its target of RM127 billion in tax...

THE Panama Papers, the world’s biggest leak, highlighted the complex ways used by companies and individuals to conceal who the actual beneficiaries of a company are. Some of them put their money into offshore accounts such as in Labuan, which is also an off-shore financial centre and tax haven. One...

Foreign banks have been asked to make a written commitment to Malaysia’s central bank to stop trading the ringgit in the offshore non-deliverable forwards market in the bank’s latest move to protect a weakening currency, banking sources said. Foreign banks have been sent a form letter to sign, which asks...

The Philippines is eyeing to seal tax treaties with all nine other Asean member-states, according to the Bureau of Internal Revenue (BIR). The country already has effective double taxation agreements (DTAs) with Indonesia, Malaysia, Singapore, Thailand and Vietnam, BIR Assistant Commissioner Marissa O. Cabreros noted in a presentation at last...

India and New Zealand also vowed to press for successful negotiations of the Regional Comprehensive Economic Partnership (RCEP). India and New Zealand decided to amend the bilateral tax treaty and expressed commitment to work towards a comprehensive free trade agreement with a view to boost economic ties on Wednesday. The...

Five more governments have signed up to an international convention on cooperating with tax authorities around the world, bringing the number of participating jurisdictions to 103. The OECD’s Convention on Mutual Administrative Assistance in Tax Matters is a wide-reaching agreement to exchange information about taxpayers between authorities either on request...

In the latest move to revamp the tax system in Indonesia, the government is considering setting up tax haven areas to entice home money that was stashed abroad. The idea was initiated by former finance minister Bambang Brodjonegoro who believed that the distinct region could facilitate the investment of funds...

Indonesia has defined two islands near Singapore as its own tax havens to prevent taxpayers from keeping their assets offshore – in Singapore, for example. The two islands identified by Indonesia are Bintan and Rempang, according to a report on Monday in the Singaporean daily «Straits Times» and a story...

“Maybe lower the income tax from 25 percent to 20 percent first, then 17 percent.” The government will once again provide the public with tax break following its tax amnesty program. It is currently reviewing a plan to lower income tax rates and the possibility of establishing a tax haven,...

Despite Western opposition, the 134-member Group of 77 is continuing to pursue a longstanding proposal for an inter-governmental UN-affiliated tax body aimed at combating corporate tax dodging and curbing illicit financial flows, including money laundering and off-shore banking. The proposal has already been shot down twice by Western nations, first,...

An agreement on avoidance of double taxation, which was signed today between the governments of Ukraine and Malaysia, will allow enhancing business contacts and attracting investors. Ukrainian President Petro Poroshenko said this at a joint news conference with Malaysian Prime Minister Najib Tun Razak, an Ukrinform correspondent reports. “We think...

Ukraine is to sign a double tax agreement with Malaysia that will cap withholding tax rates on dividends, interest, and royalties. Under the deal, the withholding tax rate for dividends would be capped at 15 percent. A special rate of five percent would apply to dividends received by a company...

THAI MULTINATIONAL companies will be impacted on their cross-border business activities due to rapidly evolving tax laws in Europe and Asia-Pacific. For instance, the European Union (EU) achieved a groundbreaking result on June 20 by agreeing to a package of tax measures to combat corporate tax avoidance, which will be...

A new double tax treaty between France and Singapore will be of particular help to French companies operating in Singapore, especially in the construction industry, an expert has said. Franck Lagorce, an expert in French tax at Pinsent Masons, the law firm behind Out-law.com was commenting following an announcement from...

Sydney-A new report by Oxfam said Australia’s federal government lost an estimated 5 billion US dollars in revenue in 2014 as a consequence of tax avoidance by multinational corporations with Australian operations. The non-governmental organization said in its report that investments from Australian-based big companies in tax havens globally grew...

Asia Pacific The January – March edition of tax highlights for the Asia Pacific region highlights industry developments from Australia, China, Hong Kong, India, Indonesia, Korea, Malaysia and Singapore including: Australia’s new tax system for Managed Investment Trusts The final stage of China’s B2V reform to be rolled out from...

SINGAPORE (BLOOMBERG) – Singapore’s biggest banks are in talks about setting up a system for sharing information on prospective clients, in an effort to combat money laundering in the city-state. DBS Group Holdings, OCBC and UOB are exploring the possibility of a countrywide model for anti-money laundering and enhanced client...

Luxembourg’s state prosecutor has launched a judicial inquiry into allegations of money laundering involving hundreds of millions of dollars against Malaysia’s sovereign wealth fund 1Malaysia Development Bhd (1MDB). The prosecutor said on Thursday that the inquiry followed evidence that funds held by the Malaysian government in offshore accounts in Singapore,...

In March 2010, the FATCA was enacted in the United States (“US“) for the purpose of preventing the non-compliance of US persons with US taxation laws through the participation and cooperation of foreign governments and financial institutions. FATCA Implementation in Malaysia On 30 June 2014, Malaysia reached an agreement in...

The pet project of Prime Minister Narendra Modi – the International Financial Services Centre (IFSC) – housed in the Gujarat International Finance Tec City – has received a boost in the Union Budget 2016/17. The long pending tax issue has been decided with 9 per cent minimum alternate tax (MAT),...

In his budget speech, the financial secretary has highlighted a gloomy outlook of the Hong Kong economy in 2016. He forecasts that the gross domestic product growth rate of Hong Kong in 2016 could be as low as 1 per cent to 2 per cent, as compared to 2.4 per...

CAN NEPAL IMPOSE CAPITAL GAINS TAX ON NCELL BUYOUT DEAL? This question has been making rounds ever since TeliaSonera, the largest shareholder in Nepali telecom operator, Ncell, announced its decision to sell 60.4 per cent of its stake in the telecom company to Malaysian giant, Axiata, for $1.03 billion. Divergent...

LABUAN: Labuan will keep its duty-free status despite the Government losing revenue in uncollected taxes due to the smuggling of cigarettes and other contraband from the island, said Datuk Seri Najib Tun Razak. The Prime Minister said the Government did not want to penalise the people of Labuan for the...

The revived Asia Tax Awards will feature categories for companies, firms and individuals. The Asia Tax Awards are back! More than five years after they last took place in November 2010, the Asia Tax Awards will be held once again on Thursday May 5 2016, following the Asia Tax Forum,...

In an effort to provide their tax administrations with more tools to combat corporate tax avoidance through transfer pricing, officials from 31 countries today signed an agreement setting out the parameters for automatic exchange of country-by-country reports on large multinational corporations. The agreement — the Multilateral Competent Authority Agreement on...

THE lifting of Labuan’s tax-free haven status starting with alcoholic beverages, should it happen, is a quick way to boost Government coffers, although the overall impact may not be too significant. By rough estimates, Yeah Kim Leng, economist and dean at the school of business at Malaysia University of Science...

India’s biggest source of FDI is India itself, money departing on a short holiday to a tax haven and then routed back as FDI. Will the government muster up the political will to clamp down on the tax-allergic business elite? This could be a bumper year for the ever-lucrative tax...

The jury is out on whether a group helmed by President Joko Widodo can revive stalled growth in Indonesia’s Islamic finance industry. The head of the world’s biggest Muslim population is chairing a new committee tasked with bringing fragmented regulations under one roof and taking action to spur the market,...